Write three paragraphs to discuss whether Dragon Beer should be introduced into the Chinese market and for what reasons. Discuss the logic and numbers behind the decision.

BLACK SCHOLES OPTION PRICING Basics Inputs Stock Price Now (P) Standard Dev - Annual (6) Riskfree Rate - Annual (RF) Exercise Price (X) Time To Maturity - Years (t) $69.81 71.65% 4.95% $70.00 0.5777 (1) (In(P/X)+( kg +o2/2)- t o- Enter =(L.N(B4/B7)+(B6+B5^2/2)*B8y(65'SQRT(B8)) (2) d.-ovi Enter =B13-B5 SQRT(88) Outputs d1 d2 0.320 -0.225 0.625 0.411 $15.70 (3) Standard Cumulative Normal Distribution (d1) Enter =NORMSDIST(B13) Copy to cell B16 and copy to the range B21:B22 N(D1) Nd2) Call Price (V) (4) The Black-Scholes call formula is: V=PN d)-Xend) Enter =B4*815-87*EXP(-86*88)*816 -d1 -d2 N(-41) N(-d2) Put Price -0.320 0.225 0.625 0.411 -$15.70 (5) -d1 Enter --B13 and copy to cell B20 (6) The Black-Scholes put formula is: Put =-PN(-d)+Xer (-d,) Enter =-B4*B21+B7*EXP(-86*B8)*822 BLACK SCHOLES OPTION PRICING Basics Inputs Stock Price Now (P) Standard Dev - Annual (6) Riskfree Rate - Annual (RF) Exercise Price (X) Time To Maturity - Years (t) $69.81 71.65% 4.95% $70.00 0.5777 (1) (In(P/X)+( kg +o2/2)- t o- Enter =(L.N(B4/B7)+(B6+B5^2/2)*B8y(65'SQRT(B8)) (2) d.-ovi Enter =B13-B5 SQRT(88) Outputs d1 d2 0.320 -0.225 0.625 0.411 $15.70 (3) Standard Cumulative Normal Distribution (d1) Enter =NORMSDIST(B13) Copy to cell B16 and copy to the range B21:B22 N(D1) Nd2) Call Price (V) (4) The Black-Scholes call formula is: V=PN d)-Xend) Enter =B4*815-87*EXP(-86*88)*816 -d1 -d2 N(-41) N(-d2) Put Price -0.320 0.225 0.625 0.411 -$15.70 (5) -d1 Enter --B13 and copy to cell B20 (6) The Black-Scholes put formula is: Put =-PN(-d)+Xer (-d,) Enter =-B4*B21+B7*EXP(-86*B8)*822